The ACIT, Circle-2(1), Vijayawada V. M/s Kranthi Road Transport Pvt Ltd., Vijayawada

ITA 43/VIZ/2004

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 0795 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 6 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2010
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 24-03-2010
• Assessment Year: 2000-2001
• Appeal Filed On: 23-01-2004
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: G S S GOPINATH
• Assessee Lawyers: G V V SATYANARAYANA
• Keywords: Depreciation; Additional evidence

Judgement Text

ITA NO. 43/VIZAG/2004 KRANTHI ROAD TRANSPORT PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI BR BASKARAN, ACCOUNTANT MEMBER ITA NO.43/VIZAG/2004 ASSESSMENT YEAR: 2000-01 ACIT, CIRCLE-2(1), VIJAYAWADA VS. M/S. KRANTHI ROAD TRANSPORT (P) LTD., VIJAYAWADA (APPELLANT) (RESPONDENT) PAN NO: AAACK 9322 N APPELLANT BY: SHRI G.S.S. GOPINATH, DR RESPONDENT BY: SHRI G.V.V. SATYANARAYANA ORDER PER SHRI SUNIL KUMAR YADAV, ACCOUNTANT MEMBER: THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST TH E ORDER OF THE CIT (A) ON VARIOUS GROUNDS WHICH ARE AS UNDER: 1) THE ORDER OF THE CIT (A) IS ERRONEOUS BOTH ON FACTS AND LAW 2) THE LD CIT (A) ERRED IN GRANTING RELIEF OF RS.1, 03,570/- UNDER THE HEAD TRUCK MAINTENANCE EXPENDITURE, SINCE THE EXPENDITURE WAS NOTHING BUT ILLEGAL PAYMENTS MADE T O CHECK POST STAFF UNSUBSTANTIATED BY ANY OTHER EVIDENCE EX CEPT SELF MADE VOUCHERS WITHOUT SIGNATURES OF PAYEES. MOREOVE R, WHILE CONSIDERING THE VOUCHERS PRODUCED BEFORE HIM AND QU ANTIFYING THE DISALLOWANCES TO RS.1,20,000/-, THE CIT (A) OUG HT TO HAVE GRANTED AN OPPORTUNITY UNDER RULE 46A TO THE ASSESS ING OFFICER. 3) THE LD CIT (A) OUGHT TO HAVE SUSTAINED THE DISAL LOWANCE OF DEPRECIATION OF RS.13,87,590/- IN VIEW OF THE FA CTS NARRATED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER. T HE COPIES OF REGISTRATION CERTIFICATES AND PERMITS BY THEMSELVES DO NOT CONSTITUTE EVIDENCE THAT THE VEHICLES WERE USED FOR BUSINESS PURPOSES ON OR BEFORE 30.09.1999. THE CIT (A) OUGHT TO HAVE INSISTED ON THE DETAILS OF THE CUSTOMERS TO WHOM TH E VEHICLES WERE HIRED BEFORE 30.09.1999 BESIDES GRANTING AN OP PORTUNITY TO THE ASSESSING OFFICER UNDER RULE 46A. 4) THE LD CIT (A) ERRED IN DELETING THE ADDITION OF RS.27,46,456/-. THE CIT (A) OUGHT TO HAVE SEEN THAT THE PAYMENTS THOUGH WERE MADE IN INSTITUTIONAL NAMES WE RE ACTUALLY PAID TO SOME INDIVIDUALS ON SELF MADE VOUC HERS. THE 67 COPIES OF AFFIDAVITS MENTIONED BY THE CIT (A) IN TH E ORDER WERE ITA NO. 43/VIZAG/2004 KRANTHI ROAD TRANSPORT PAGE 2 OF 3 ACTUALLY FILED ON OR AFTER 25.03.2003 THOUGH EVIDEN CE WAS CALLED FOR BY THE ASSESSING OFFICER MUCH BEFORE, THEREBY L EAVING NO ROOM FOR THE ASSESSING OFFICER TO VERIFY AND CROSS CHECK THE SAME. AS SUCH THE CIT (A) OUGHT TO HAVE GRANTED OPP ORTUNITY UNDER RULE 46A OR REMANDED THE MATTER TO ASSESSING OFFICER FOR FRESH EXAMINATION RATHER THAN GRANTING RELIEF. 5) ALLOWING EXPENDITURE TOWARDS BOOKING COMMISSION IN EARLIER YEARS CANNOT BE A GROUND FOR GRANTING RELIE F DURING THE IMPUGNED YEAR. 6) THE LD CIT (A) IS NOT CORRECT STATING THAT NOTHI NG HAPPENED FROM 30.01.003 TILL 27.03.2003. A LETTER W AS ISSUED BY ASSESSING OFFICER ON 04.02.2003 CALLING FOR INFORMA TION IN RESPONSE TO WHICH THE ASSESSEE VIDE ITS LETTER DT. 13.02.2003 REQUESTED FOR 15 DAYS TIME. A FURTHER LETTER WAS IS SUED BY THE ASSESSING OFFICER ON 14.02.03. THE ASSESSEE STARTED SUBMITTING HIS REPLY TO THE ASSESSING OFFICERS LETTER ISSUED ON 04.02.2003 ONLY FROM 24.02.2003 ONWARDS LEAVING NO TIME FOR TH E ASSESSING OFFICER TO CROSS VERIFY THE CONTENTS. 7) THE LD CIT (A) OUGHT TO HAVE APPRECIATED THAT TH E PENALTY PAID TO ESI FOR VIOLATION OF STATUTE, IS NOT AN ADMISSIBLE EXPENDITURE. EVEN OTHERWISE THE EXPENDITURE UNDER CONSIDERATION RELATES TO THE F.Y 1977-98 AND AS THE ASSESSEE HAS FOLLOWING MERCANTILE SYSTEM THE EXPENDITURE DOE S NOT RELATE TO THE PRESENT YEAR 2. THE LD DR DURING THE COURSE OF HEARING HAS INVIT ED OUR ATTENTION THAT THE ASSESSEE HAS FILED VARIOUS EVIDENCE FIRST TIME BEFORE THE CIT (A) AND THE CIT (A) WITHOUT CONFRONTING THE SAME TO THE AO HAS PLACED RELIANCE UPON THE SAME AND GRANTED RELIEF TO THE ASSESSEE. A SPEC IFIC QUERY WAS RAISED FROM THE ASSESSEE, WHETHER ANY ADDITIONAL EVIDENCE WAS FILED BEFORE THE CIT (A). INITIALLY HE HAS CONTENDED THAT NO ADDITION AL EVIDENCE WAS FILED BEFORE THE CIT (A) BUT FROM PERUSAL OF THE AFFIDAVI T FILED BY THE ASSESSEE IT IS CLEAR THAT HE HAS FILED SO MANY EVIDENCES BEFORE THE CIT (A) FIRST TIME. THOUGH THE ASSESSEE STATED IN THE AFFIDAVIT THAT TH E DOCUMENTS MENTIONED IN THE AFFIDAVIT WERE FILED BEFORE THE AO AS WELL A S CIT (A), BUT VARIOUS DOCUMENTS WERE NOT FILED BEFORE THE AO AND THESE FA CTS ARE CLEAR FROM THE DETAILS OF DOCUMENTS AND THE DATE OF FILING. THE AS SESSMENT ORDER WAS PASSED ON 27 TH MARCH, 2003 AND DOCUMENTS AT S.NO.8, 9, 11 TO 14 O N PAPER BOOK NO.1, DOCUMENTS AT S.NO.1 & 2 ON PAPER BOOK NO .2 WERE FILED AFTER THE DATE OF THE ASSESSMENT ORDER; MEANING THEREBY T HESE DOCUMENTS WERE NOT FILED BEFORE THE AO AND THEY WERE FILED FIRST T IME BEFORE THE CIT (A). ITA NO. 43/VIZAG/2004 KRANTHI ROAD TRANSPORT PAGE 3 OF 3 3. IT IS ALSO OBVIOUS FROM THE ORDER OF THE CIT (A) THAT THE DOCUMENTS WERE RELIED ON BY HIM WHILE DECIDING THE IMPUGNED I SSUE, MEANING THEREBY CIT (A) HAS ADMITTED AND RELIED UPON THE EVIDENCES WHICH WERE NOT FILED BEFORE THE AO IN GROSS VIOLATION IN THE PRINCIPLES OF RULES 46A OF INCOME-TAX RULES. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW TH AT IN THE INTEREST OF JUSTICE THE MATTER SHOULD BE RESTORED BACK TO THE F ILE OF THE AO FOR VERIFICATION OF THE ADDITIONAL EVIDENCES FILED BEFO RE THE CIT (A) AND TO ADJUDICATE THE ISSUE AFRESH. WE ACCORDINGLY SET ASI DE THE ORDER OF THE CIT (A) AND RESTORE THE MATTER TO THE FILE OF THE AO TO RE-ADJUDICATE THE IMPUGNED ISSUES AFRESH AFTER AFFORDING AN OPPORTUNI TY OF BEING HEARD TO THE ASSESSEE IN THE LIGHT OF THESE EVIDENCES STATED IN THE AFFIDAVIT FILED BEFORE THE CIT (A). 4. IN THE RESULT THE APPEAL FILED OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 5 TH MAY, 2010. SD/- SD/- (B R BASKARAN) (SUNIL KUMAR YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER PVV/SPS VISAKHAPATNAM, DATE: 05-05-2010 COPY TO 1 THE ACIT, CIRCLE-2(1), VIJAYAWADA 2 3 M/S KRANTHI ROAD TRANSPORT (P) LTD.,AUTONAGAR, VIJA YAWADA THE CIT (A) VIJAYAWADA 4 THE CIT VIJAYAWADA 5 THE DR, ITAT, VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM